The Premium on a Pound Put Option Is

question 69

Multiple Choice

The premium on a pound put option is $.03 per unit. The exercise price is $1.60. The break-even point is ____ for the buyer of the put, and ____ for the seller of the put. (Assume zero transactions costs and that the buyer and seller of the put option are speculators.)

• A) $1.63; $1.63
• B) $1.63; $1.60
• C) $1.63; $1.57
• D) $1.57; $1.63
• E) None of these are correct.

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Definitions:

Brand Loyalty

The tendency of consumers to continue buying the same brand's products or services over time, reflecting a strong preference.

Psychographic

Relating to the study of personality, values, opinions, attitudes, interests, and lifestyles of an individual or group.

Market Segmentation

The process of dividing a target market into smaller, defined categories of consumers who share similar characteristics.